this post was submitted on 14 Jun 2025
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82
What is an example of the JC Penny's effect ? (lemmy.world)
submitted 21 hours ago by [email protected] to c/[email protected]
18 comments fedilink hide all child comments
 

So the JC Penny's effect is a phenomenon in consumer psychology where consumers react negatively to something even though it is better to them but it doesn't feel better.

It is named after the store JC Penny's who got rid of sales and instead lower prices to what they would be on sale all the time. This was better for the consumer but consumers liked sales so they hated it.

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[–] [email protected] 2 points 1 hour ago* (last edited 1 hour ago)

I can 100% confirm that the "discount" perception is a huge aspect of the decision making process for a purchase.

I sell a shitload of stuff on Facebook Marketplace because I buy, sell, fix, refurbish electronics and appliances

I know from experience that the way to sell something for $100, is to first post it for $120, and then 8 minutes later reduce the price to 100. People see the crossed out 120 and they think *oh my god this is my chance"!

I've been buying and selling for almost 30 years, I was like the first user on eBay LOL... This is such a baffling but real phenomenon! For example on ebay, if you want to get 30% more than market value, post your item for a dollar and let people fight! The idea of a deal, even when it doesn't exist, is so potent.

[–] [email protected] 89 points 20 hours ago (3 children)

A&W had a 1/3 lbs burger to compete with McDonald's quarter pounder and it didn't sell people because thought it was smaller than a 1/4 lbs burger.

[–] [email protected] 14 points 17 hours ago (1 children)

McDonald’s also had a ”Third Pounder” and it had the same issue

[–] [email protected] 16 points 16 hours ago

Worked cashier during that time. People are some of the dumbest people

[–] [email protected] 17 points 20 hours ago

Perfect example

[–] [email protected] 9 points 20 hours ago (2 children)

Is there any actual proof of that? Because I see plenty of restaurants advertise 1/3 lb burgers these days.

[–] [email protected] 30 points 20 hours ago (1 children)

The problem wasn't that they had a 1/3rd pound burger, it's that they advertised it in direct competition with a 1/4 pound burger at the same price and people were too dumb to know that 1/3 > 1/4 because 4 > 3.

https://www.awrestaurants.com/blog/memories-history/the-truth-about-aws-third-pound-burger-and-the-major-math-mix-up/

They did re-do the advertising... decades later...

https://www.awrestaurants.com/press/press-release/101921-aw-rebounds-from-worst-marketing-fail-with-burger-for-math-challenged/

[–] [email protected] 2 points 4 hours ago (1 children)

"1/12 lb more beef then a quartet pounder" would have been a great marketing slogan!

[–] [email protected] 1 points 16 minutes ago

I like the new one... "3/9th pound burger! And if it's sold out, we'll replace it with a 2/6th pound burger at no extra cost!"

[–] [email protected] 28 points 20 hours ago (3 children)

I remember someone talking about an airline that advertised very low prices up-front but then added tons of fees for every individual thing, and when adding all the fees up for the service you'd expect with any other airline the end price would be the same. However, given that all the services/fees are technically optional, this is actually an ideal pricing model since you don't have to pay for any services you don't want.

[–] [email protected] 5 points 4 hours ago

We will soon find out with Southwest. They are moving to assigned seats because they think many travelers are avoiding them due to their open seating. However they may find that their most loyal customers no longer have a good reason to choose Southwest. Time will tell.

I’d like to see some airline adopt a seat + weight pricing. You pay a base fee and then you’re weighed with your luggage.

[–] [email protected] 7 points 20 hours ago

Exactly

[–] [email protected] 5 points 20 hours ago (1 children)

So not an example of that effect then?

[–] [email protected] 6 points 20 hours ago (1 children)

How so? I feel it is an example of the effect because customers are drawn in with a low price and are surprised by a plethora of seemingly-sneaky fees, which take up a large portion of the total bill. Customers feel negatively about the long list of fees and the implication that they've been tricked, but they wouldn't think twice if the fees were just included in the base price. It is against their best interest to be automatically and opaquely charged for all regular services (i.e. normal airlines) instead of being transparently given the option to forego those that they do not care about (i.e., fee-based airline).

[–] [email protected] 4 points 18 hours ago* (last edited 18 hours ago) (1 children)

Ehhh i’m not sure I agree with you, I get what they’re saying. It’s not about being drawn in and pulling what’s borderline a bait and switch, it’s about literally not knowing that one deal is better than the other at face value with all info available. Deciphering fees and running through all that stuff is not the same thing. The 1/4 vs 1/3 pound burger is a much better example

It would be like me offering you 3 nickels or 1 quarter and you decide to pick 3 nickels because you don’t realize that 1 quarter is worth more than 3 nickels

[–] [email protected] 1 points 10 hours ago

Exactly.